Fresh consultations begin for e-commerce policy

Source: The Hindu Business Line, Dec 03, 2018

New Delhi: The Centre has revived its unfinished agenda of drafting a national e-commerce policy, this time under the Department of Industrial Policy & Promotion (DIPP), and fresh consultations with stakeholders have begun for inputs, a government official has said.

“The consultation process and the drafting of the policy is being led by the DIPP this time instead of the Commerce Department. The idea is to formulate a policy which would balance the interests of all stakeholders and would be acceptable to most,” the official told BusinessLine.

The government’s first attempt of drafting an e-commerce policy, led by the Commerce Department, was abandoned after the first draft came in for heavy criticism by most stakeholders, including both domestic and foreign e-commerce companies.

“The Commerce Department has submitted all suggestions of the various sub-groups that were formed to formulate the first draft e-commerce policy and those, too, would be taken into consideration by the DIPP,” the official said.

The DIPP has already held consultations on logistics and exports and more would happen over the next few weeks.

Once the consultations are over and the e-commerce policy is drafted, it would be sent to all Ministries and Departments concerned for their comments, the official added.

With the fast growing e-commerce market in India, currently valued at about $27 billion, the government had felt the need to come up with a comprehensive e-commerce policy to better regulate and manage the industry. The country also faces intense pressure to get into negotiations to liberalise the sector at various bilateral and regional forums and the World Trade Organization.

Initial draft

“The Commerce Department had carried out extensive stakeholder consultations and come up with its initial draft on the policy and it was to be put online for public comments, but then it had to be officially shelved as many stakeholders expressed their unhappiness with many of the provisions in the draft,” the official said.

The draft recommended permitting 49 per cent foreign direct investment (FDI) in inventory-based business-to-customer e-commerce model which is prohibited at present. The domestic industry, including traders, had argued that this contradicts the government’s stated intent to strengthen Press Note 3, which bars any FDI in inventory-based online retail.

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